Tensions Escalate as Trump Slaps Tariff on India Amidst Trade Talks

Former World Bank Chief Economist Kaushik Basu criticized the US economic policy under President Donald Trump, which imposed a 25% tariff on Indian goods, affecting agriculture and dairy sectors. Basu emphasized the inconsistency in Trump's stance, given the relatively modest US-India trade deficit. Further negotiations are scheduled.


Devdiscourse News Desk | New Delhi | Updated: 31-07-2025 10:53 IST | Created: 31-07-2025 10:53 IST
Tensions Escalate as Trump Slaps Tariff on India Amidst Trade Talks
  • Country:
  • India

In a move that has escalated trade tensions, US President Donald Trump announced a 25% tariff on Indian goods starting August 1, amid stalled bilateral trade negotiations with India. Former World Bank Chief Economist Kaushik Basu expressed bewilderment at the harsh stance, noting India's relatively modest trade deficit compared to other nations.

Basu, currently an economics professor at Cornell University, highlighted that the US's current policy perspective risks negatively impacting India's agriculture and dairy sectors. Trump's tariffs could further strain these sectors, which are already facing challenges due to surplus labor problems.

While President Trump described India as a 'friend,' he criticized India's high tariffs and defense procurements from Russia. The upcoming visit of a US negotiation team to India aims to resolve these trade tensions through further bilateral discussions.

(With inputs from agencies.)

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